Mandriva co-founder ousted from Linux firm

Gael Duval, a co-founder of Linux seller Mandriva, is among employees who lost their jobs at the company after it became unprofitable in its most recent financial quarter.

Duval confirmed Wednesday that he was terminated as part of a layoff that in his estimation cost the jobs of 18 other employees at the French Linux seller.

"It's not easy: You create your job and some jobs for a dozen other people, and seven years later, the current CEO of the company tells you 'now you go away,'" he said in an interview Wednesday.

Duval is going to give the open-source start-up business a second shot, though. "I've been working for one year, in lost hours, on a new concept of open-source operating system called Ulteo. "It will be an open-source system, and part of the concept is going to rely on broadband Internet access."

Mandriva, so named after MandrakeSoft acquired Brazilian Linux company Conectiva, has been struggling financially, but emerged from bankruptcy protection and became profitable. However, in its most recent quarter, ended in December, the company slipped back into the red, reporting a loss of $712,000 (590,000 euros) compared with a profit of $1.24 million (1.03 million euros) a year earlier.

"Mandriva's financial results...are disappointing," the company said of the quarter, blaming the situation on dwindling sales of boxed products at retail, marketing expenses from the new release, economic fears in Brazil and a slow start to new deals with computer makers.

The company faces competition not only from better-established, global companies such as Red Hat and Novell, but also from new versions such as Ubuntu that can be downloaded over the Internet for free.

To deal with the situation, the company announced the elimination of redundant jobs in Brazil and France and said Chief Executive Francois Bancilhon plans to become chairman; co-founder and former Chairman Jacques Le Marois will remain on the company's board.

It's also possible the company will have legal action to reckon with. Duval said he planned to sue Mandriva for an "abusive layoff."

Bancilhon told CNET News.com that Mandriva followed the correct French labor law procedures for layoffs when company finances require cost-cutting. "We carefully followed the strict rules that are set for this type of situation," he said. "Gael was laid off as part of a cost-cutting exercise, and I wish the financial situation of the company had allowed us to keep him in his current position."